Williams Scotsman files plan for IPO

White Marsh company seeking up to $250 million

Provides modular buildings

A White Marsh company that is a large provider of modular "space solutions," from mobile offices to temporary classrooms, is planning to take itself public.

Scotsman Holdings Inc., better known as Williams Scotsman, announced its intentions yesterday in a Securities and Exchange Commission filing and said it is preparing to expand further into the European market. It has not decided how many shares to sell but expects to trade on the Nasdaq stock market under the ticker symbol WLSC.

The company didn't estimate a price for the shares, but indicated in the filing that it planned to raise up to $250 million.

"The company intends to use the proceeds of the offering to repay a portion of its indebtedness," said Michele Cunningham, a Williams Scotsman spokeswoman, declining to comment further.

The company, which was founded more than 50 years ago, has 85 branch offices, 1,250 employees and 25,000 customers ranging from homebuilders in need of temporary offices to school systems desperate for more space. It leases out its 95,000 modular buildings and portable storage facilities. It also sells such units and installs them. Revenue last year was just under $500 million.

The past two years haven't been great. Williams Scotsman lost $3.4 million last year and $11.7 million in 2003, which it blames on "the recent economic downturn."

But it estimates that it has cornered one-quarter of the highly fragmented market. Its main competitor is GE Modular Space.

Modular units are constructed in factories and then installed on site, and they're everywhere. In some cases, "you'll walk into a modular building and you'll never know it's a modular building," said Chad Harvey, deputy executive director of the Modular Building Systems Association in Harrisburg, Pa., a trade association that focuses on the residential side of the industry.

"They sent modular units up to Lower Manhattan right after 9/11 and they regularly work with [the federal government] to get units out on scenes of natural disasters," said Fronda J. Cohen, a spokeswoman for the Baltimore County Department of Economic Development.

Williams Scotsman said that classrooms account for more than a quarter of its revenue, and with the increasing push across the country to decrease class sizes, the company considers schools a growth market. Other government opportunities exist as well: This year it expects to bid on as many as eight U.S. military modular building projects worth more than $100 million.

The company expanded in 1999 to Canada, and last year to Mexico and Europe - in the latter by buying part interest in a large modular provider in Spain.

"We believe the fragmented nature of the European market presents us significant acquisition opportunities," the company said in its filing.